In Bookstore Chains, Display Space Is for Sale

By MARY B. W. TABOR

Published: January 15, 1996

One of Lynn Snowden's bleakest times as an author was a grim 20 minutes she spent sobbing at a Barnes & Noble counter in midtown Manhattan.

Having found her book "Nine Lives" on a back shelf, she asked a clerk if he would shift it to the front of the store. When he twice refused, saying that the book "wasn't on his schedule to be moved," she began to shake and cry. "It was horrible," she recalled. "It was like my book wasn't good enough."

What Ms. Snowden assumed was that her book's position in the store depended solely on the manager's discretion. What she did not know was that the front of the store, as well as the windows, ends of aisles and other display spaces in many bookstores now often carry price tags. And in her case, her publisher, W. W. Norton, had chosen not to pay.

Selling space in stores is nothing new to grocers, department stores and most other retailers. Floor and shelf position have long been treated as prime real estate, the most expensive areas being near the front of the store and at the cash register.

But in the rarefied world of bookselling, where store owners prided themselves on showcasing books that reflected their personal tastes, letting a publisher influence displays with payment or account credit has been considered counterintuitive, if not unseemly.

That is changing. In a growing trend that increasingly treats books like tennis shoes, there is little that a publisher cannot pay for these days when it comes to bookstore display space, especially in the big national chains, according to documents obtained by The New York Times and interviews with publishing executives and store owners.

The practice -- which involves the promotion of books, using money from publishers called cooperative advertising allowances -- has encouraged discounting and helped bigger bookstores draw customers.

But it has also prompted lawsuits contending that independent dealers are being trampled, as well as concern that the sale of bookstore retail space, along with the growing power of chains, tends to homogenize bookstores and hinder prospects for all but mass-appeal books from deep-pocketed publishers.

"The big books of the season that get heavy co-op advertising and the chains' cooperation are going to get much bigger play than the smaller books that aren't expected to be potential best sellers," said Roger Straus, president of Farrar, Straus & Giroux.

Though the price per title is not high, by offering publishers dozens of such programs -- many of which link advertising space, displays and discounts -- and selling them repeatedly, the chains stand to make a substantial amount of money for what is a low-margin industry. In 1994, Barnes & Noble's superstores and mall stores made a profit of $25.5 million on $1.6 billion in all sales, including fees for display space. That's about 1.6 percent.

Much Promotion, Less Elaboration

Though most chains and other bookstores are reluctant to discuss their promotional programs in detail, selling space in stores is becoming more common.

At Barnes & Noble, for example, joining the "Discover Great New Writers" program, which assures that a book appears face out in the front of all 358 superstores for two or three months and gets a review in a special brochure, costs publishers $1,500 a title, according to the chain's 1996 promotions guide and publishing executives. To have a book featured for one month on a cardboard floor display in front, called a dump, a publisher pays $10,000.

At the company's mall stores -- B. Dalton, Doubleday and Scribner's -- end-of-aisle, or endcap, displays cost $3,000 a title for one month; a two-month spot in "New Arrivals" costs $2,500, according to the documents.

And at Borders, publishers pay $15,000 to advertise a book with a 30 percent discount in a 1996 pre-Christmas issue of USA Today. This provides top-tier listing in ads and front-of-store display for the month.

The chains and other bookstores refuse to comment on how much they make from the programs. But publishers, who collectively pay millions to the chains in co-op money each year, say that the amount is high and that the money helps discount books. "Given the profit margins in retail these days, I suspect we drop a lot of money onto their bottom line," a high-ranking publishing executive said.

In the case of Borders, if publishers buy all 16 slots in the pre-Christmas ad -- which include some less expensive placements -- the chain collects $120,000. Since the space costs $45,000, according to the newspaper, Borders could make $75,000 for that one advertisement. Barnes & Noble gets $150,000 for its Discover New Writers program for the year, and $120,000 for the dumps.

But the practices have recently come under attack, with the American Booksellers Association insisting, in part, that many publishers favor the chains by unfairly giving them more co-op money and by streamlining the big stores' reimbursement process. Many independents complain that co-op money is sometimes not available to them. When it is, they are asked to produce reams of receipts before collecting what often amounts to a few dollars.